Setting Social Housing Up To Fail

The Pallister government recently announced that it has transferred management responsibilities for 66 publicly-owned housing units in Winkler from Manitoba Housing to a community-based non-profit. Don’t be fooled by the language in the news release, which frames this as a matter of “responding to local needs” and the “community.” Handing over expensive public services to under-funded non-profit groups is a recipe for disaster.

The maintenance, upkeep, and construction of housing costs money. A lot of money. Whoever takes on the task of managing housing needs access to a lot of cash and the ability to generate income. The chances of a non-profit housing organization raising enough capital to maintain housing units and apartment buildings over the long term is close to zero, unless they raise rents much higher to generate more income. But wait: the whole point of public housing is to provide affordable rental options to low-income residents.

This is why the government plays such an important role in social housing. Governments have the ability to raise enough revenue to adequately maintain buildings and other properties. Passing responsibility for housing to organizations with fewer resources causes the eventual loss of housing units, and fewer options for people in need.

The UK began a similar process years ago, putting newly created non-profit “Housing Associations” in charge of managing public housing that had been directly managed by municipalities. This didn’t create any short-term problems, but in the long term there was no further municipal investment in public housing. The Housing Associations weren’t able to pay for construction and upkeep. And now, waiting lists for public housing in the UK are close to 15 years long in many areas. Furthermore, people employed in management positions suddenly went from being well-paid municipal employees to the employees of nonprofits … that often struggled to pay competitive wages.

Surely these aren’t the “benefits of local management” that the Pallister government has in mind: broken-down housing stock, under-paid management, and more people out on the street? Or is that part of his vision for making Manitoba the “most improved” province in Canada?

The government’s announcement is about transferring management, not ownership. But the writing is on the wall. The news release indicates that this management transfer is a “pilot project,” which suggests that we can expect more announcements like this down the road. Let’s all hope that this is a short road, and one that leads our province back to stronger public investment in public housing, which is a very high value-for-money use of public funds, and a great way to improve Manitoba for all Manitobans.